Firefighters Local Union No. 1784 v. Stotts

PETITIONER:Firefighters Local Union No. 1784
RESPONDENT:Stotts
LOCATION:Spofford Juvenile Center

DOCKET NO.: 82-206
DECIDED BY: Burger Court (1981-1986)
LOWER COURT: United States Court of Appeals for the Sixth Circuit

CITATION: 467 US 561 (1984)
ARGUED: Dec 06, 1983
DECIDED: Jun 12, 1984

ADVOCATES:
Allen S. Blair – on behalf of the Petitioners
Richard B. Fields – on behalf of the Respondents
Rex E. Lee – amicus curiae

Facts of the case

Question

Audio Transcription for Oral Argument – December 06, 1983 in Firefighters Local Union No. 1784 v. Stotts

Warren E. Burger:

We will hear arguments first this morning in Firefighters Local Union v. Stotts, and the consolidated case.

Mr. Blair, you may proceed whenever you are ready.

Allen S. Blair:

Thank you, Mr. Chief Justice, and may it please the Court:

In this case the Court is confronted with a situation where Respondents settled an employment discrimination case for specified relief, waiving any further relief.

Later, because Respondents had not foreseen the possibility of events which they should have foreseen, they discovered they wanted additional relief under circumstances which make the granting of such relief inequitable and illegal.

The granting of that relief is the subject of the appeal before the Court at this time.

This matter arises out of the following background.

The case was settled in 1980 with the entry of a consent decree which provided hiring and promotional relief consistent with the complaints which were filed in the cause.

The city agreed to a long term goal of raising the percentage of blacks on the fire department in each rank to the percentage of blacks in the work force as a whole.

Byron R. White:

I take it this was a Title 7 case.

Allen S. Blair:

It was, Your Honor.

The complaint was also filed under Section 1981 and Section 1983 of the 1964 Civil Rights Act.

The decree also contained what were interim goals for hiring and promotions.

No relief was granted with regard to the city’s layoff policies or the city’s seniority policies, and there was no constructive competitive seniority awarded in the decree, again consistent with the complaints, and the Respodents waived any further relief.

In May of 1981, the City of Memphis, facing a fiscal crisis, announced that there would be layoffs in every city department, including the fire department, and those layoffs were to be conducted consistent with the city’s longstanding, city-wide seniority policy which was adopted with regard to layoffs in 1975.

The Respondents sought injunctive relief in the Federal District Court against the application of the senior policy insofar as it would reduce the percentage of blacks on the fire department.

The District Court, after ruling that the issue before the court was not whether the city could lay off, but the manner in which the city would lay off, issued the requested injunctive relief.

The court directed the city to come up with a plan consistent with the court’s ruling.

That court’s order caused three innocent, incumbent, white firefighters to be laid off who would not have been laid off had the seniority policy been applied.

It also caused seven additional senior, innocent, incumbent, white drivers to be demoted or laid off from their position or, in the parlance of the shop, bumped down.

It also caused five additional senior innocent, incumbent, white inspectors to be bumped down and nine additional senior, innocent, incumbent, white lieutenants to be bumped down.

The Court of Appeals affirmed in an opinion which addressed several matters really not at issue in the case.

While the Respodents and the Court of Appeals attempt to uphold the District Court’s ruling as both an interpretation and a modification of the consent decree, we respectfully submit that it is clear the consent decree did not provide the relief requested and that the circumstances necessary to allow for the modification of a consent decree are absent herein.

Further–

William H. Rehnquist:

Mr. Blair, in your view, does it make any difference whether this is treated as an interpretation of the decree or a motion to modify it?

Allen S. Blair:

–Justice Rehnquist, in terms of the ultimate result, I don’t think it makes any difference.

It is our position that it was not an interpretation, that the relief was not provided in the decree at all, and that if the Court then wants to take the next step and analyze whether modification would have been proper under these circumstances, then we respectfully submit that modification was not proper because the proper circumstances were not present in this case.

I hope that answers your question.

William J. Brennan, Jr.:

Mr. Blair, may I ask, have any of these white firefighters been reinstated?

Allen S. Blair:

Justice Brennan, they have.

Allen S. Blair:

Everyone is back to the position which they held when the layoffs took place.

William J. Brennan, Jr.:

Yes.

Allen S. Blair:

However, there are continuing effects from this injunction.

William J. Brennan, Jr.:

Well, as to them?

Allen S. Blair:

Yes, as to them.

William J. Brennan, Jr.:

As to those who have been reinstated?

Allen S. Blair:

As to them.

It is very clear that with regard to those three white firefighters who would not have been laid off had the seniority system been applied, that they are now suffering from the loss of competitive seniority status–

William J. Brennan, Jr.:

What exactly have they lost?

Allen S. Blair:

–They have lost… they got no seniority credit during the time that they were laid off.

William J. Brennan, Jr.:

And how long was that?

Allen S. Blair:

That was approximately a month.

William J. Brennan, Jr.:

A month.

Allen S. Blair:

Yes, sir.

William J. Brennan, Jr.:

And how about back pay?

Allen S. Blair:

There is back pay due and owing.

I represent the union, and we have made the demand upon the city.

William J. Brennan, Jr.:

Is that also a month, Mr. Blair?

Allen S. Blair:

I beg your pardon?

William J. Brennan, Jr.:

Is the back pay also a month?

Allen S. Blair:

The back pay with regard to those three firefighters would be a month, but with regard to the seven additional drivers, the five additional inspectors, and the nine additional lieutenants, there would also be back pay due and owing by our contention.

Now, I am here arguing on behalf of the city–

William J. Brennan, Jr.:

How, by your contention, how much would they be owing?

Allen S. Blair:

–If Your Honor please, I have never really computed that, but as to those people who were bumped down in classification, they would be due the amount that is the difference between what they would have earned had they been retained on the job and what they earned in a lower-paying classification.

William J. Brennan, Jr.:

Does the city have any authority to make then whole in this respect?

Allen S. Blair:

It’s the union’s contention that the city does.

Now, the–

William J. Brennan, Jr.:

That it does?

Allen S. Blair:

–Yes, Your Honor.

William J. Brennan, Jr.:

Well, if it does, why isn’t this case moot?

Allen S. Blair:

If Your Honor please, we would respectfully submit that a proposition that the city could, by with the stroke of a pen, as Respondents contend, right the wrong and make this case moot, is tantamount to suggesting that if a case can be settled, a case is moot.

Every case can be settled, and under that proposition, every case would be moot.

William J. Brennan, Jr.:

Well, suppose your contention were accepted by the… you said you are asking the city to make them whole.

Suppose the city were to do so.

Would you say the case was not moot?

Allen S. Blair:

Yes, Your Honor, we would say it, the case was not moot.

William J. Brennan, Jr.:

You still say it’s not.

Why?

Allen S. Blair:

Because this case is capable of repetition, yet evading review.

As spelled out in our Joint Opposition to the Suggestion of Mootness and as spelled out in our reply brief in detail, we clearly feel that this case falls within that doctrine as well.

William J. Brennan, Jr.:

While I have you interrupted, may I ask, did the Tennessee Supreme Court hold that the memorandum of understanding with the union was unenforceable?

Allen S. Blair:

Yes, Your Honor.

William J. Brennan, Jr.:

Under state law?

Allen S. Blair:

It did.

William J. Brennan, Jr.:

How does that bear, if it does, on the provision of 703(h) as to bona fide seniority system?

Allen S. Blair:

If Your Honor please, I don’t believe it has any effect whatsoever.

It is–

William J. Brennan, Jr.:

Even if it is illegal under state law?

Allen S. Blair:

–That’s right.

If Your Honor please, this layoff, this senior-based layoff policy that is in question in this case was unilaterally adopted by the city as well in 1975, and it is our position that a senior system need not be collectively bargained under 703(h) in order to be protected.

William J. Brennan, Jr.:

You mean, independently of the memorandum with the union, which I gather your state court has said is unenforceable.

Allen S. Blair:

That’s right.

William J. Brennan, Jr.:

Void under state law.

Allen S. Blair:

Right.

William J. Brennan, Jr.:

There was a unilateral policy which–

Allen S. Blair:

That’s right.

William J. Brennan, Jr.:

–provided this?

Allen S. Blair:

Right.

And I believe that that is clear from the testimony of Mr. Sabatini in the record in the Joint Appendix, and I believe 703(h) makes no reference whatsoever to the necessity of a seniority system being collectively bargained in order to be protected.

William J. Brennan, Jr.:

I guess most of them are, aren’t they?

Allen S. Blair:

Well, I would say most are, but that doesn’t mean that they are exclusively, and we would submit that there are at least some mentions in the legislative history which would support our position as well.

William J. Brennan, Jr.:

Do you know of any that has passed on this question, any decisions?

Allen S. Blair:

There are a few decisions which have ruled on this question, and they are mentioned in the amicus brief of the International Association of Firefighters on the merits in this case.

Harry A. Blackmun:

Mr. Blair, if the District Court’s order is invalidated, does back pay and seniority automatically follow?

Allen S. Blair:

Well, if Your Honor please, it would be our position on behalf of the union that it certainly should–

Harry A. Blackmun:

Would a separate suit be necessary for that purpose?

Allen S. Blair:

–I don’t believe so.

I don’t see why that would be necessary if this order is reversed.

Harry A. Blackmun:

Obviously my questions indicate that I, too, am concerned about mootness.

Allen S. Blair:

If Your Honor please, there can be–

John Paul Stevens:

May I ask why it would automatically–

Allen S. Blair:

–Excuse me.

John Paul Stevens:

–Finish your answer to Justice Blackmun.

I’m sorry, I thought you had.

Allen S. Blair:

Well, I was going to address myself to the fact that there are these continuing effects and that this is one of those cases that deals with the doctrine of or is affected by, covered by, if you will, the doctrine capable of repetition yet evading review.

So it may be that Your Honor wants to ask the question at this point.

John Paul Stevens:

Yes, I did want to ask about the specific consequences because I was wondering if, as you answered in response to Justice Brennan, the collective bargaining agreement is not enforceable, what is the source of the city’s legal obligation to pay the back pay?

Allen S. Blair:

Well, if Your Honor please–

John Paul Stevens:

I understand they have the power to do it, but I think you are also contending on behalf of the union they have an obligation to do it.

Allen S. Blair:

–Under their own rules and regulations–

John Paul Stevens:

Just the matter of their own rules and regulations.

Allen S. Blair:

–That’s right.

John Paul Stevens:

Don’t they have the power to change those rules?

Allen S. Blair:

Certainly they do, but they haven’t.

John Paul Stevens:

So in all events, isn’t it a managerial decision as to whether they will pay the back pay and the seniority, regardless of who wins the lawsuit?

Allen S. Blair:

Well, if Your Honor please, it certainly would be our contention on behalf of the union that if they have a rule and regulation that is in effect and an obligation arises out of the enforcement of that rule and regulation, that an employer could not at that point at its whim say, well, that’s not our rule and regulation anymore, after the fact, and thereby in effect erase the obligation or do away with the obligation.

It certainly is true that management has a lot of normal management prerogatives which it can change during the course of the employment relationship, but if there is an obligation that arises out of an area covered by or a rule or regulation which arises out of an area that is covered by normal management prerogative, I don’t think management can then erase the obligation by simply saying, well, we are going to change it now.

The rule and regulation was in effect then.

John Paul Stevens:

Sort of a stop.

May I also ask, I gather all these employees that are affected by it were hired an the same day, November 5, ’79 according to–

Allen S. Blair:

Well, if Your Honor please, it is true that as to those people who were laid off–

John Paul Stevens:

–Right.

Allen S. Blair:

–When you got down to the bottom of the seniority list, if you will, that the three white firefighters were affected were hired the same day as the three blacks who would have been affected had the seniority policy of the city been applied.

That is true.

John Paul Stevens:

And the policy apparently required they be laid off in reverse alphabetical order, is that right?

Allen S. Blair:

That’s right.

John Paul Stevens:

What was the source of that decision?

Allen S. Blair:

Well, if Your Honor please, as I think this court recognized in California Brewers, every seniority system is going to have aspects of that system which are not based on the length of employment.

What you have here is a facially neutral, nondiscriminatory, alphabetical tie-breaker designed to apply in just this situation, and the source was that the city was trying to find a fair way to establish or create a tie-breaker.

John Paul Stevens:

It as the city’s decision rather than the collective bargaining agreement.

That’s really what I was asking.

Allen S. Blair:

That’s right, Justice Stevens.

Lewis F. Powell, Jr.:

Okay, thank you.

Mr. Blair, you mentioned the likelihood of this same problem arising in the future.

Do you think that is true with respect to Memphis?

Allen S. Blair:

I do, Justice Powell.

I think it is very definitely true.

If I might, I would like to explain with regard to that.

The City of Memphis has an extremely limited tax base.

Income taxes on the state and local level in Tennessee are unconstitutional.

The City of Memphis is already taxing at the maximum level at which it can tax at the present time insofar as sales tax is concerned.

We can’t raise the sales tax again.

As regards our property tax, there was a one-time decrease when the last sales tax increase came into effect, but we are really, from a practical standpoint, at the peak of the property tax at this particular time.

We have a rather odd situation where industrial and commercial property in Tennessee is actually taxed at a higher rate than residential property which naturally has the effect of discouraging business and industry to move into our area.

Therefore, the local lawmakers are extremely hesitant to raise those taxes.

Now, given that situation, you have to superimpose on that the fact that the city is a business like any other business, and it has increasing costs at the present time.

It has suffered under extremely high interest rates, continues to suffer under that at the present time.

The spiraling cost of health care affects the city because it provides at least in part health care coverage to its employees.

And there are other increasing costs.

Employee wages continue to increase.

Thurgood Marshall:

Is any of that other than the income tax unique to Memphis as compared to every other large city in this country?

Allen S. Blair:

Justice Marshall, I can’t really speak authoritatively to that except that I would say this, that I don’t imagine that there are a great many cities which are in the position of Memphis in that they have reached the maximum sales tax that they can impose.

Other than that and the income tax, I would say no, but I would respectfully submit to Your Honor that those are significant differences.

You are talking about two of what are the three major sources normally that a municipality has for income.

To continue to address your question, Justice Powell, it also seems to me that this is one of those cases that evades review.

As this Court has previously recognized, as noted in our reply brief, layoffs are, by their nature, temporary.

Now, that is not a hard and fast rule, but this Court has recognized that in its prior decisions, and we would submit that this case clearly falls within the doctrine of capable of repetition, yet evading review.

With regard to the interpretation argument, may it please the Court, any claim of the Respondents that is based on an interpretation or effectuation of the consent decree must be settled with reference to the terms of that consent decree, and the terms here are completely unavailing to the Respondents.

What we really have here is a situation where they sought new relief barred by the waiver to bail them out.

In fact, the situation was clearly foreseeable.

We have a situation where the city adopted a seniority-based layoff policy in 1975.

It was negotiated into the union’s contract in 1975.

Therefore, the union and the city foresaw the serious possibility of layoffs in 1975 and codified that concern, if you will, in a public document.

Other cities were experiencing a great many financial difficulties at that time.

In our own circuit, the city of Cincinnati had to lay off in their fire department and confronted a dispute very much like this one which went to the Sixth Circuit, which resulted in an opinion by the Sixth Circuit in 1978, of which the Respondents should have been aware.

And we would submit that any plaintiff in a Title 7 case must analyze the relief that he or she is getting in a consent decree by way of those landmark events in the employment relationship, hiring, promotion, demotion, layoff and recall, termination, and retirement, and look at the relief that they are going to get in the consent decree and say is this all that I am entitled to, is this all that I need?

Clearly they should have foreseen it.

Sandra Day O’Connor:

Mr. Blair, did the department when it entered into the consent decree waive its right to prove that future beneficiaries of the affirmative action were not actual victims of the discrimination, if it existed?

Allen S. Blair:

No.

I think that, Justice O’Connor, I think what we really had, as is true in any consent decree, is that the parties waive their right to litigate the issues when you enter into a consent decree.

That’s really what–

Sandra Day O’Connor:

Well, did the department waive its right to prove that these people who benefitted from the order of the court were not actual victims of discrimination?

Allen S. Blair:

–With regard to the relief granted, yes, but not with regard to additional relief that might be requested later.

Really what we think we have here is an arm’s length bargained agreement which should have been honored by the court, and given that an interpretation would not avail Respondents of the relief that they are requesting and a modification was not proper, in light of the waiver, then really the court should have stopped there–

But given the fact that the court went further, if it was proper for the court to go further, then clearly, the court couldn’t say that we waived, that is, the city and the union, waived our right to insist that victim status be proved and established.

I hope I have answered your question.

I notice that my time is running out, and I would like to reserve at least two minutes for rebuttal.

I would finally close by saying that if this case is not reversed, it will seriously discourage Title 7 settlements in the future.

Thank you.

Warren E. Burger:

Mr. Solicitor General?

Rex E. Lee:

Mr. Chief Justice, and may it please the Court:

The issue in this case is squarely controlled by this Court’s holding in Teamsters v. United States that federal courts lack the power to grant constructive, competitive seniority to nonvictims of employment discrimination, that is, those who have not shown that they individually are persons against whom discrimination was practiced.

In Teamsters, the District Court found that the employer had engaged in a pattern and practice of discrimination against blacks and Spanish-surnamed Americans, and in order to remedy this discrimination, the Court of Appeals awarded constructive, retroactive seniority to each member of the class.

The previous term, in Franks v. Bowman Transportation Company, the Court had held that proven individual victims were entitled to be slotted into their rightful place in the seniority system, that is, the place that they would have enjoyed but for the discrimination.

Under Franks, therefore, both the discriminatees and also their innocent coworkers whose rights are necessarily affected by the grant of constructive competitive seniority, are relegated to the respective positions that they would have enjoyed if the discrimination had never occurred, but for persons not proven to be victims, the Court held in Teamsters that such an award of constructive seniority is outside the remedial authority of a federal court.

The defect in this court’s order, the order of the district court in this case, is that what the court did here is precisely what this court held in Teamsters that a federal court cannot do, namely, grant constructive competitive seniority to persons who have not proven that they are actual victims.

And the only difference is in the timing.

Under Teamsters, the district court could not have given enhanced competitive seniority at the time of its original decree against the possibility of layoffs to nonvictims.

Certainly it has no power, no greater power once they occur.

This Court has observed frequently, and I am quoting now from Hardison, that seniority systems are afforded special treatment under Title 7, and indeed, it is quite apparent from the legislative history of Title 7 that the Dirksen-Mansfield compromise which brought 703(h) into existence was key to the enactment of Title 7.

Given the importance of seniority systems to Title 7, it would make no sense at all, we submit, to ignore seniority in the single context where it really matters, particularly when you consider that beginning with Franks in 1976, this Court has been called upon with some frequency and in various contexts to reach an accommodation between the achievement on the one hand of the twin objectives of Title 7, which is to eliminate discrimination and compensate its victims, and on the other hand, the protection of bona fide seniority systems.

There are about a half a dozen such cases that deal with that accommodation, and the opinions are characterized by two persistent themes.

The first of those themes focuses on who are the beneficiaries of Title 7 remedial orders, and draws a bright line distinction between victims and nonvictims, and that’s Franks and Teamsters.

The second theme concerns the other half of the remedial calculus which is who pays the bill, and more specifically, to what extent are the costs for eradicating employment discrimination and compensating its victims, to be borne by those who did the discriminating, namely, the employers, through back pay, front pay, enhanced benefits seniority, if you will, and to what extent by innocent victims… or excuse me, third-party innocent coworkers, other employees who have done no wrong but whose rights will necessarily be affected if the remedy includes an award of competitive seniority because as this court observed about a year and a half ago in Fort Motor, a competitive seniority award costs the employer nothing and sends the bill to fellow workers.

Out of these cases, the law which has emerged is clear, and it is that there is only one circumstance under which federal courts are empowered as part of their remedy for employment discrimination, to award competitive seniority rights, and that is where the beneficiaries of those competitive rights are actual victims.

That–

Sandra Day O’Connor:

Mr. Lee, can the employer entering into a consent decree waive that requirement, in your view?

Rex E. Lee:

–I suppose that an employer could, as a matter of agreement, at the front end of the decree, could agree to it, and thereby would waive it, but Teamsters is rather careful in spelling out the procedure that is to be followed, and it is a two-step procedure.

The first step is the process of proving pattern and practice, and the second step is the practice of proving, or is the process of proving who is a victim.

From one perspective, Franks itself, which does grant competitive seniority to actual victims, imposes part of the cost on innocent coworkers, but at least under Franks, the cost distribution among the victims and the innocent coworkers is the same distribution that would have occurred if there had been no discrimination.

It simply puts the relative parties back in the same position that they would have enjoyed in the absence of discrimination.

To go beyond that and to require that coworkers bear the burdens that they would not have borne even if their employer had never discriminated is to go beyond the limits of federal judicial power, and that’s what Teamsters holds.

William J. Brennan, Jr.:

May I ask, Mr. Solicitor General, does it make any difference in your argument that the Tennessee Supreme Court has held that this particular memorandum between the union and the employer is unenforceable under state law?

Rex E. Lee:

It does not, Justice Brennan, for this reason.

What is before–

William J. Brennan, Jr.:

Just let me ask, that doesn’t bear on the question whether this is a bona fide seniority system within 703(h)?

Rex E. Lee:

–No, it does not because it is very clear from the record in this case, from the testimony of the mayor and others in the joint appendix that absent the court order, the city is within its right as a matter of its own exercise of governmental prerogatives, would have followed this seniority system It was the city’s system, so that absent the court order, it is the seniority system that would have prevailed.

John Paul Stevens:

Mr. Solicitor General, may I just be sure, under your argument, if the parties in advance had agreed on precisely what the district court ordered as a part of the original consent decree, are you contending that would have been beyond the court’s power to approve?

Rex E. Lee:

No, so long as those innocent third parties were in fact represented, as I think they could have been held to have been represented by the Firefighters Union which did intervene in this case.

John Paul Stevens:

Well, then, doesn’t your argument depend on the court’s order being a modification as opposed to an interpretation of the decree?

John Paul Stevens:

If the judge had in effect said this is what I think everybody really agreed to, then I suppose your argument would fall.

He didn’t say that, I know, but–

Rex E. Lee:

It was a kind of a logical sequence, you could make that order, but that is far too much of a distortion of the interests in the facts of this case, of innocent third workers, third parties, to say that they did in fact agree to that, because in fact they simply never got beyond the pattern and practice issue in that case.

John Paul Stevens:

–You certainly wouldn’t suggest that the city itself, by agreeing to a consent decree, could waive the rights of nonvictims.

Rex E. Lee:

Of course not, and that is exactly the point that I hope that I was making.

The assertion by the Respondents and several amici that Title 7 seniority guarantees, 703(h), is substantive and not remedial simply cannot survive this court’s decisions in Teamsters and Ford Motor.

The issue in Ford Motor, for example, was not whether the provisions of the seniority system substantively amounted to employment discrimination, but rather, whether the proposed remedies permissible, in the language of this court’s closing sentence, threaten the interests of other innocent employees by disrupting the established seniority hierarchy.

Teamsters and Ford Motor amply demonstrate the obvious, that in crafting equitable remedies under Title 7, Federal Courts are not free to ignore the effect that those remedies will have on substantive Title 7 policies, and the protection of seniority systems is certainly one of those policies.

Finally, it has also been suggested that notwithstanding the defects… I mean, Teamsters is simply unavoidable.

Teamsters does control this case.

Teamsters is a Title 7 decision.

But the Respondents and their amici nevertheless suggest that Title 7 is not the only source of judicial authority to enter this decree.

That argument will notwithstand analysis because under any circumstance it was an equitable decree, and basic principles of equity teach that federal courts applying equitable principles are to shape those decrees in accord with the substantive policies to be achieved.

This is, above all, an employment discrimination decree.

The federal policy dealing with employment discrimination is contained in Title 7, and under those circumstances, under any argument, the content of an employment discrimination decree must be shaped by the substantive policies of Title 7, including the protection of seniority systems.

Unless the Court has further questions, I have nothing else.

Warren E. Burger:

Very well.

Mr. Fields?

Richard B. Fields:

Mr. Chief Justice, and may it please the Court:

I would like… I think this case provides us with two issues: first, whether the case was moot because the preliminary injunction issued by Judge McRea has been irrevocably carried out, and the Court’s review of that injunction would not affect any of the parties’ legal rights in this matter; secondly, if this case is not moot, then was the preliminary injunction a proper exercise of the district court’s discretion to enter an order necessary to effectuate the specific purpose of the decree, that is, to remedy the hiring and promotional practices of the City of Memphis in their fire department–

William H. Rehnquist:

Mr. Fields, do you, do you contend that the order entered by Judge McRea in this case, the most recent order, is a modification?

Richard B. Fields:

–No, sir, I do not contend it’s a modification.

William H. Rehnquist:

You disagree with the Court of Appeals then.

Richard B. Fields:

No.

William H. Rehnquist:

Well, the Court of Appeals said the principal issue raised on this appeal is where the district court erred in modifying the 1980 decree.

Richard B. Fields:

Well, Your Honor, first, it’s our belief that the district court simply effectuated the purpose of the decree, and did–

William H. Rehnquist:

Then you do think the Court of Appeals was wrong in saying that it was a modification.

Richard B. Fields:

–No, I do not think the Court of Appeals… no.

What the Court of Appeals in the Sixth Circuit opinion in Brown v. Neeb, Judge Brown specifically talks about modification in terms of effectuating the purpose of the decree.

That’s the terms the Court of Appeals was speaking of about modification.

Richard B. Fields:

There is no layoff provision in the decree, as we have all… as admitted, and so there is really no specific provision to modify.

Our position is the court was simply enforcing the decree as written.

William H. Rehnquist:

Well, why do you think the Court of Appeals then referred to it as modifying the decree?

Richard B. Fields:

Your Honor, I don’t know.

I think if we get to that point, if you were speaking strictly about modification of law, this is not in terms of modifying, for example, in the antitrust cases where defendants want to be released from certain obligations of the decree.

First, if it please the Court, this case is moot.

All of the people that were laid off by the 1981 preliminary injunction have been rehired.

Byron R. White:

What would you suggest we do if we agree with you?

Richard B. Fields:

I suggest that you vacate the judgment below and remand for a determination of mootness.

Byron R. White:

A determination.

You say it’s moot.

We don’t need to determine it, and wouldn’t we… wouldn’t we vacate the judgment below and remand and direct the Court of Appeals to tell the district court to dismiss the case?

Richard B. Fields:

Yes, sir, that’s correct.

Byron R. White:

Completely, and do away with the consent decree, and–

Richard B. Fields:

No, sir.

This order on appeal does not have anything to do with–

Byron R. White:

–Well, it’s a judgment, isn’t it?

A consent decree is a judgment, isn’t it?

Richard B. Fields:

–The consent decree is, yes, sir, but this–

Byron R. White:

Well, then why… normally, normally we strip the whole thing down clear through the district court.

Richard B. Fields:

–No, this court has–

Byron R. White:

Well, do you… I don’t know… you can’t… I don’t think you can have it both ways.

Richard B. Fields:

–The only thing on appeal in this case is the preliminary injunction that the district court entered in May of 1981.

The consent decree is not before the court.

That was presented in Orders v. Stotts which this court denied certiorari review on on November 1, 1982.

The consent decree itself has not been attacked by any of the parties.

Byron R. White:

But if that… unless you say that the case… unless the mootness necessarily undermines the case–

Richard B. Fields:

Well, but the mootness doesn’t go to the specific… the provisions of the consent decree.

The mootness–

William H. Rehnquist:

–Could we ever hold that a particular part of a decree was moot without holding that the whole case was moot?

Richard B. Fields:

–Your Honor, I am… my position is in this court, and I don’t think anyone has said to the contrary, that the decree itself is valid, that–

William H. Rehnquist:

So there is still an underlying case in controversy?

Richard B. Fields:

–No, there’s no underlying case in controversy in terms of the court’s preliminary injunction as a result of further enforcing the decree.

The decree itself is not under attack in this case.

Sandra Day O’Connor:

Mr. Fields?

Richard B. Fields:

Yes.

Sandra Day O’Connor:

If the city was short of money again, could this situation be repeated in the future?

Richard B. Fields:

It is our position, Your Honor, that that is a different case.

In between the time of May 1981 and the present, the city has not only put all of these people back to work, it has hired 63 new firefighters, it has decreased the property taxes, and it is moving forward in its remedial obligation under the decree.

A tax–

Sandra Day O’Connor:

Well, I’m just asking whether it is possible that in the future this city might run short of money and need to implement some kind of a layoff program.

Richard B. Fields:

–Yes, Your Honor, but that layoff would have to be determined as to those circumstances.

For example, in this layoff, if there had only been a layoff of 21 firefighters instead of 24, there wouldn’t have been any adverse impact upon the minority percentages at that rank.

So as the city moves to its obligation to remedy the past discrimination in the fire department, those circumstances would change.

It must be emphasized that Judge McRea entered a preliminary injunction only requiring the city to maintain certain percentages in certain classifications.

He did not order any specific method of layoff.

It was at the city’s sole discretion to come forward with what method of layoff it wanted to, and it just so happened the city came forward again with a seniority-based layoff system.

The city… in fact, the union, one of the petitioners in this case, asked the city not to lay off anyone, to provide a system where workers could voluntarily take leaves of absences so other workers could remain on the force.

Another union–

Sandra Day O’Connor:

Well, I suppose the Department was bound by the city’s seniority plan.

Richard B. Fields:

–No, Your Honor.

The city never adopted any layoff policy.

Sandra Day O’Connor:

Well, I suppose the department was bound by the city’s plan.

Richard B. Fields:

The fire department?

Sandra Day O’Connor:

Yes.

Richard B. Fields:

Yes, it was, but the city is the defendant in this case.

it is the Memphis Fire Department and the City of Memphis, and the City never adopted a formal layoff policy until April of 1981, just before these layoffs.

There was never any city policy about layoffs.

There was the memorandum of understanding which this court has recognized as unenforceable.

It was really at the city’s sole discretion on how to lay off.

Richard B. Fields:

If you look into the layoff policy, seniority was not the only factor.

The first thing the city was required to do was to measure the various qualifications among the employees, and then they could apply seniority.

If there were specific positions in the fire department that the city wished to be exempted from layoff, they could.

There were only certain jobs in the fire department that were subject to layoff It just so happened that these jobs were where most of the gains had been made in the prior year under this consent decree, and that is the reason Judge McRea entered the preliminary injunction, to maintain, for the city to maintain the remedy that had been achieved thus far.

William J. Brennan, Jr.:

Well, may I ask, Mr. Fields, that on page 31 of your brief–

Richard B. Fields:

Yes, sir.

William J. Brennan, Jr.:

–In arguing mootness, you say this: even if the May 18 order were reversed, employees who were laid off in 1981 still would receive no seniority credit for that period unless the city itself chooses to alter its layoff policy.

Richard B. Fields:

Yes, sir.

William J. Brennan, Jr.:

Is that Tennessee law or is that federal law or what?

Richard B. Fields:

No, that’s the state of… the state of the situation in the court now.

There is no claim in the district court by any employees for seniority or back pay.

There is no claim in any forum in Tennessee for those things.

William J. Brennan, Jr.:

Why is there not?

Richard B. Fields:

Because the union or those employees have never made a claim for that.

Byron R. White:

Well, they are making, they are making, they are litigating the issue here, and unless they have, unless they win on this issue, there is no basis for a claim.

Richard B. Fields:

If they win or they lose, Your Honor, there is no basis for it.

Byron R. White:

Exactly.

Well, if they win, there is a basis for it, an arguable basis for it, so there is no use in making claims until there is some arguable basis for it.

Richard B. Fields:

Well, Your Honor, there is no basis for it because everything has been achieved by the preliminary injunction.

All of these employees are back at work and even if this court affirmed, the district court would not grant seniority to these employees.

It is… you know, also, the court needs to understand, it was not only these employees that were laid off.

There were 24 employees laid off.

There were three black firefighters laid off.

There were also other black employees of the fire department that were laid off because their jobs were abolished.

The home fire safety representatives, as mentioned in our appendix, those were mostly black employees, and their jobs were abolished.

This was not simply a layoff of white employees to maintain blacks in certain jobs.

And those are the circumstances under which Judge McRea entered the preliminary injunction after a hearing on the matter.

Also, Your Honors, these three employees have been back for approximately two and a half years.

The Petitioners argue that there are continuing effects.

First, they argue that these employees missed an opportunity to take promotional exams.

Richard B. Fields:

In their reply brief they admit error.

They also say that these employees would be… their, their ability to become 30 year captains would be delayed by this loss of seniority.

They admit that is an error because that provision of the city charter was repealed in 1977, and these employees who were laid off were hired in 1979.

Again, I would emphasize that nothing this court would do will change that situation.

All the employees are back to work.

In fact, some of the employees who were laid off not only are back in their original positions, but they have received promotions.

The fire department–

William J. Brennan, Jr.:

Well, are any of them losers of a month’s back pay and seniority credit?

Richard B. Fields:

–Excuse me, Your Honor?

William J. Brennan, Jr.:

Are any of those reinstated employees nevertheless out a month’s back pay and seniority credit?

Richard B. Fields:

They are as a result of what the city did, but like we say in our brief, the city could change that unilaterally, just as it adopted this layoff program unilaterally.

William J. Brennan, Jr.:

You mean unilaterally it can pay them a month’s back pay?

Richard B. Fields:

Absolutely, Your Honor.

There is–

William J. Brennan, Jr.:

And what… how do they restore the month’s seniority credit?

Richard B. Fields:

–They just grant the seniority, change their seniority days.

It is… the loss of seniority is the city’s policy.

Even if you look at the memorandum of understanding, that is not in the memorandum of understanding that has any effect at all as delineating what the city’s policy is.

Warren E. Burger:

Is that a matter of grace on the part of the city in your view?

Richard B. Fields:

Yes, sir, it is.

Warren E. Burger:

Then there is a way to enforce that by the individuals?

Richard B. Fields:

No, sir, as far as I can tell there is no way to enforce it.

It is not–

Warren E. Burger:

Then it doesn’t carry much water here, does it?

Richard B. Fields:

–In this court?

Yes.

Richard B. Fields:

No, sir, and that’s my point.

What is done in this court will not affect that one way or the other.

William J. Brennan, Jr.:

Well, are you arguing it that because of this it is not a bona fide seniority system under 703(h)?

Richard B. Fields:

Your Honor, it is our position we don’t have to reach that question, but it was never litigated at the preliminary injunction hearing.

William J. Brennan, Jr.:

You’re saying there just isn’t any seniority system.

Richard B. Fields:

No, Your Honor, there isn’t.

It was something that was adopted by the city just prior to the layoffs, and we are saying that the city had an enforceable duty under the consent decree to remedy past discrimination and could take actions that would abrogate that obligation to maintain that remedy under the consent decree.

And that’s what Judge McRea did.

He told the city that you cannot reduce the proportion of blacks in these ranks pending a hearing on the merits.

There was never a hearing on the merits for an injunction in this matter, and we never got into the proof of whether it was a bona fide seniority system or not.

This was simply preliminary relief, and that has been irrevocably carried out.

In fact, the plan the city submitted was not submitted on May 18.

It was submitted in June at the behest of the court.

The city at that time could have submitted any plan that met the court’s order.

It just so happened it chose a seniority plan to submit in June, and that was not appealed from any… by from any party in this case.

The only order that has been appealed from is Judge McRea’s May 18 preliminary injunction which just provides that the city maintain certain ratios and certain classifications.

The city–

John Paul Stevens:

Mr. Fields, let me ask you a question on the mootness and all that.

Richard B. Fields:

–Yes.

John Paul Stevens:

In effect you have argued, well, the city is spending a lot of money which it didn’t need to spend because it could just pay these people, if it wanted to, and give them retroactive seniority.

Isn’t the other side of the coin that you are up here arguing about something your clients really don’t care about?

Why do you bother arguing the merits if it is moot?

Richard B. Fields:

Well, Your Honor, basically if it is moot, then my clients have no interest in it.

That’s true.

There’s nothing that is going to harm my clients–

John Paul Stevens:

Even if you lose–

Richard B. Fields:

–Yes, sir.

–on the merits.

Richard B. Fields:

That’s correct–

John Paul Stevens:

So you are kind of giving us an advisory opinion on what we ought to do on the merits.

Richard B. Fields:

–Well, but I think if this court affirms, it is giving an advisory opinion to the city on something that is not in controversy anymore.

May I also say in terms of the capable of review but evading… evading review but capable of repetition argument, the city argues that Memphis is peculiar, for some reason, that this may happen again very soon.

It must be understood that this was the first layoff ever in the history of the City of Memphis.

Even during the ’74-’75 recession there was no layoff of city employees by the City of Memphis, even though layoffs were prevalent throughout the country.

Richard B. Fields:

And–

William H. Rehnquist:

But so far as this court is concerned, we had a case last year involving a Boston firefighter.

I mean, our judgment has to be not so much on the basis of whether it might happen again in Memphis, but whether this kind of a situation is apt to evade review.

Richard B. Fields:

–But in layoffs, Your Honor… but, Your Honor, layoffs are not inherently capable of evading review, or capable of not being reviewed because as one of our amicus briefs shows, in the City of Detroit, approximately 600 black, or 600 police officers were laid off in 1980, and about half of those remain on layoff today.

In major industries throughout the country, particularly in the steel industry, employees were permanently laid off when steel companies were shut down.

It is the peculiar facts of this situation that this has been carried out, that the people have come back to work and are back in their position–

William H. Rehnquist:

Well, but the same peculiar facts roughly obtained in the Boston situation, I think.

Richard B. Fields:

–Yes, but in that, of course, we don’t know how long the layoffs would have happened because in the Boston case the state legislature passed a statute mandating that the workers be put back to work.

That’s what intervened.

Layoffs themselves, though, are not inherently short of duration, and there are facts in other instances to show that–

Also, in terms of the interest rate argument, in the reply brief, this is the first time we had seen it, I don’t know the city could predict interest rates.

In our national economy we have the Secretary of Treasury saying the interest rates are going down, the Council of Economic Advisors Chairman saying they are going up.

It is our position that really this Court shouldn’t decide that issue if major people in the administration can’t even decide it.

In terms of what Judge McRea did, and in terms of the consent decree, this consent decree does have a specific purpose as stated in paragraph 17.

The purpose is to remedy the past hiring and promotional practices of the City of Memphis.

It also includes specific promotional goals and hiring goals.

What the city proposed to do in this case was to in fact demote and lay off people that were hired specifically and promoted specifically because of that decree.

In Exhibit A to the decree there are listed specific promotions that were to be made.

One of those promotions was to the particular named plaintiff, Mr. Fred Jones.

He was scheduled to be demoted.

There is nothing in the consent decree that puts any condition upon these promotions.

Judge McRea also looked at the other circumstances surrounding it.

In paragraph 6, again it states the purpose, that the purpose was to remedy the past hiring and promotional practices.

This preliminary injunction issued by Judge McRea is to be judged on a standard of abuses of discretion.

In this case, Judge McRea did not abuse his discretion.

Many of the blacks who were scheduled to be laid off were hired or promoted as a result of the 1980 decree.

The consent decree at no point authorizes the fire department to reduce black representation until the long term goal has been met.

It is a continuing remedial obligation.

It is the words of the consent decree and not Title 7 that governs what Judge McRea’s authority was to provide this preliminary relief.

The limited relief actually afforded by the preliminary injunction therefore did not constitute abuse of discretion.

Richard B. Fields:

The… his order of May 18 simply required that specific proportions of blacks be maintained in certain job classifications.

Judge McRea not only reviewed these job classifications, he reviewed all of the proposed layoffs that were to be made at least proposed by the fire department.

On May 18, no one knew how many people were going to be laid off.

No one knew which job classifications were necessarily going to be affected.

It was all proposed by the city.

What Judge McRea did was propose a standard by which the city could come up with a layoff policy.

At the later point when they submitted their plan, the city chose to make the layoffs in such a way that it would affect employees as they stated no a seniority basis.

There were other alternatives, but that was not gotten into by Judge McRea.

He simply told the city that they had to continue to fulfill their remedial obligation.

By issuing this narrowly drawn preliminary injunction prohibiting the city from implementing the proposed layoff policy as it would affect the relief already achieved under the consent decree, Judge McRea did not modify existing provisions of the decree; he did not confer new rights nor impose new obligations on the parties, or take away any contractual or seniority rights allegedly enjoyed by nonparties.

Rather, Judge McRea merely prevented the city from abrogating the degree in which it obligated itself to raise the percentage of black employees in each job classification.

Judge McRea consciously did not tell the city how to lay off employees.

He consciously did not involve himself in the internal operations of city employment practices.

He left it up to the city to select a means of meeting its financial obligations without interfering with this remedial obligation in the decree.

I would just like to make one other point about the United States position.

If the United States is upheld, position is upheld, then of course this would, we believe, and I think the EEOC believes in a footnote to the Justice Department’s brief, abrogate any consent decree or any case ever being settled.

It would require full litigation of every employment discrimination case.

This decree was settled–

William H. Rehnquist:

Well, what is your view about a consent decree, Mr. Fields, that provides provisions for not just hiring preference for minorities but promotional preferences?

Do you think the city could enter into a consent decree which would affect the rights of existing nonminority people to promotion?

Richard B. Fields:

–If it is reasonable, yes, Your Honor, and if there is inherent fairness here, and they have participated in the hearing on the decree, yes.

William H. Rehnquist:

You say they have a right to participate, but the decree could adversely affect their seniority expectations.

Richard B. Fields:

Every Title 7, where there is relief for plaintiffs adversely affects some seniority possibility.

William H. Rehnquist:

Well, certainly not a Title 7 decree that simply affects hiring.

Richard B. Fields:

No, Your Honor, but this decree, the decree we are working with and which this court has denied review on in terms of its provisions has a promotional provision as well.

William H. Rehnquist:

Have we ever upheld one like that that didn’t deal only with people who are identifiable victims?

Richard B. Fields:

Your Honor–

William H. Rehnquist:

Can you answer that?

Richard B. Fields:

–I don’t know.

You have upheld this decree by denying cert on it.

William H. Rehnquist:

Well, I meant one which we had actually reviewed.

Richard B. Fields:

Your Honor, I am not aware of any at this time.

William H. Rehnquist:

Neither am I.

Richard B. Fields:

But in terms of the victim–

Byron R. White:

But you would have to… your position, I suppose, is that it would have to be some real basis for thinking that the so-called innocent third parties had waived their rights by participating in the negotiations or in the case and agreeing to the consent decree.

Richard B. Fields:

–No, they did not waive their rights–

Byron R. White:

Well, you wouldn’t… would you… you wouldn’t suggest that just the city, just the city and your clients could between the two of them agree to a consent decree that would go farther than Teamsters would seemingly permit.

Richard B. Fields:

–The Teamsters doesn’t… I’m sorry, Your Honor.

Byron R. White:

You know what I mean.

Richard B. Fields:

Yes.

No, there has to be a fairness hearing in every consent decree, and if–

Byron R. White:

But doesn’t there have to be some basis for thinking that the union represented the people who might possibly be affected by this decree?

Richard B. Fields:

–Yes, sir, I don’t disagree with that.

Byron R. White:

So without the union there, or without the individual participation of the nonminority members, there wouldn’t… the city and your clients couldn’t enter into a decree that would go farther than Teamsters would permit.

Richard B. Fields:

No, Your Honor, we could enter into a decree.

Whether it would be considered fair or not–

Byron R. White:

Well, it just wouldn’t bind, it just wouldn’t bind the people who hadn’t participated in it.

Richard B. Fields:

–Oh, yes, Your Honor, it would bind those people if they had an opportunity to participate in the hearing to determine whether it’s fair or not.

Byron R. White:

Well, I know, but assume they didn’t, assume they just didn’t participate.

Richard B. Fields:

Well, if they participate, in our decree… and that’s the only one I know about right now… there was a hearing, and that people were allowed to participate.

As I understand, there has to be a hearing in a consent decree approval.

Byron R. White:

And are you really suggesting that the union here stood by and agreed to this decree knowing and realizing that they were sacrificing rights to competitive seniority?

Richard B. Fields:

The union did not stand by in the preliminary injunction hearing.

We consented to its intervention.

At the original decree entry, the union I believe stated in its brief, along with the city in the prior brief, that it considers our consent decree a reasonable consent decree for hiring and promotional purposes.

Byron R. White:

Well, I know, but do you think that they thought they were agreeing that nonvictims could be awarded competitive seniority?

Richard B. Fields:

Nonvictims could… Your Honor, I don’t know what they thought.

I mean, you will have to a them.

I just know the facts–

Byron R. White:

Well, you have to believe that they were agreeing to granting nonvictims competitive seniority, at least with respect to layoffs.

Richard B. Fields:

–Your Honor, obviously they didn’t agree at the preliminary hearing, preliminary injunction hearing.

Our position is, though, that–

Byron R. White:

Do you think they agreed before that?

Richard B. Fields:

–Your Honor, it never arose before that.

Until the layoffs which were the first in the history of Memphis occurred, this issue was never presented.

And that is another point that the petitioners present that we should have anticipated this layoff.

This layoff was not anticipated by anyone, and in fact, as I stated, in the history of Memphis there had never been a layoff.

Sandra Day O’Connor:

Well, if this case were reversed, what would the real effect be on parties who are contemplating a consent decree?

Would it be likely to encourage them to at least address these issues in the consent decree and not have a decree like this one that didn’t address layoffs?

Richard B. Fields:

If it were affirmed or reversed, that would be the happenstance.

I think after the Boston firefighters case, no one would enter a consent decree without addressing those issues.

But until layoffs occurred, particularly in the city of Memphis, this was not an issue in this case or in any of… in the Justice Department’s consent decree of 1974 which, I might add, if the Justice Department’s position today is upheld, that would abrogate its consent decree that it entered into with the city in 1974 because its decree provides for hiring and promotional goals with the City of Memphis in all departments.

Sandra Day O’Connor:

Well, if the practical effect is that the parties would be likely in the future to certainly consider and address in the decree of layoffs, then you get back to the question of the extent to which the city and the union, for example, can affect in the terms of the decree the rights of any innocent employees for layoff purposes.

Richard B. Fields:

Yes, that would, and I think this Court has begun to address that, particularly last term in the W.R. Grace case where an employer enters into a conciliation agreement with the EEOC, they may abrogate an existing collective bargaining agreement.

However, you must remember in this case we do not have an enforceable collective bargaining agreement.

If there are no further questions, thank you.

Warren E. Burger:

Do you have anything further, Mr. Solicitor General or Mr. Blair?

Allen S. Blair:

No, Mr. Chief Justice.

Warren E. Burger:

Very well.

Thank you, gentlemen.

The case is submitted.